foreclose on the collateral property. These loans have been used since the
times of Moses (pp) and Jesus (pp) by the money lenders and money
changers. When the loans could not be paid back, they would confiscate
the farmers’ land and properties, rendering them poorer and enslaving
them by requiring them to pay the loans back with their labor.
The following is an outline of the RF business law (Shari’aa) as depicted
from the Qur’aan and the tradition (Sunnah) of Prophet Muhammad (pp).
1.Shari’aa requires full documentation in writing and in the presence of
witnesses when term credit is granted:2:282 O You who have attained to faith! Whenever you give or
take credit for a stated term, set it down in writing. And let a scribe
write it down equitably between you; and no scribe shall refuse to
write as God has taught him: thus shall he write. And let him who
contracts the debt dictate; and let him be conscious of God, his Sus-
tainer, and not weaken anything of his undertaking. And if he who
contracts the debt is weak of mind or body, or is not able to dictate
himself, then let him who watches over his interests dictate
equitably.2.In ‘‘on-the-spot’’ trades of ready and available merchandise, there is no
need for a full contract, but the transaction must be confirmed by
witnesses:2:282 If, however, [the transaction] concerns ready merchandise
which you transfer directly [on the spot] unto one another, you will
incur no sin if you do not write it down. And have witnesses when-
ever you trade with one another, but neither scribe nor witness
must suffer harm; for if you do [them harm], behold, it will be
sinful conduct on your part. And remain conscious of God, since it
is God who teaches you [herewith]—and God has full knowledge
of everything.
2:283 And if you are on a journey and cannot find a scribe,
pledges [may be taken] in hand: but if you trust one another, then
let him who is trusted fulfill his trust, and let him be conscious of
God, his Sustainer. And do not conceal what you have witnessed
for, verily, he who conceals it is sinful at heart; and God has full
knowledge of all that you do.3.Shari’aa strictly prohibits riba. The Qur’aan has ruled in a clear way
that riba is strictly prohibited:40 THE ART OF ISLAMIC BANKING AND FINANCE